One of the “intergenerational transfer” rule requirements, in s. 84.1(2.31)(a) or (2.32)(a), is that a previous inter-generational exception to s. 84.1 has not previously been sought. In 2024-1038231C6, CRA addressed the situation where a parent, who has not previously sought out the intergenerational exception, simultaneously disposes of subject shares to two separate purchaser corporations, each wholly-owned by an adult child. CRA indicated that the s. 84.1(2.31)(a) or (2.32)(a) exception could be met on the basis that the two (or multiple) dispositions occur at the same time as part of the same genuine intergenerational transfer.

Now, CRA has provided essentially the same response to a variation on this transaction. An individual, who held all the shares of Opco, which were qualified small business corporation shares (QSBCS), and all of the shares (also QSBCS) of Realtyco, which was a specified group entity and whose sole asset was a commercial building leased to Opco, simultaneously sold all those shares to a corporation wholly owned by her adult child.

CRA indicated that if such simultaneous sale occurred in the context of the same bona fide intergenerational transfer of the business, and no exception had previously been claimed in respect of the same business carried on, the s. 84.1(2.31)(a) or (2.32)(a) condition would be satisfied for each disposition.

Neal Armstrong. Summary of 9 October 2025 APFF Roundtable, Q.6 under s. 84.1(2.31)(a).

Ss. 8(1)(t) and 8(14) provided the labour mobility deduction to an eligible tradesperson for eligible temporary relocation expenses, which include temporary lodging expenses incurred to travel long distances to earn income from temporary employment in construction, where all the requirements were satisfied.

CRA confirmed that such a tradesperson could (in this context of the other requirements being satisfied) deduct the difference between their accommodation expenses of $200 per night for 15 nights, and the non-taxable allowance received from their employer of $125 per night. Regarding the s. 8(14)(e)(iii) prohibition against taking the deduction “to the extent that” inter alia the tradesperson receives an allowance “in respect of” the relocation expenses unless the allowance is included in their income, CRA indicated that the quoted language excluded the deduction only for the “portion” of the expense which was matched by the non-taxable allowance, so that the $75 per night excess was deductible.

Neal Armstrong. Summary of 9 October 2025 APFF Roundtable, Q.5 under s. 8(14)(e)(iii).

On January 1, 202X, a resident individual (Mr. A) sold all the shares of Targetco for cash consideration to a resident arm’s-length purchase (Acquireco). No s. 256(9) election was made. Also on January 1, 202X, Targetco and Acquireco amalgamated without the certificate of amalgamation specifying the time at which the amalgamation took place.

CRA indicated that the time relevant to determining whether Targetco qualified as an SBC for purposes of the qualified small business corporation shares (QSBCSs) was the actual time of the disposition of the shares by Mr. A. It noted in this regard that s. 256(9) did not deem control of a corporation to be acquired at the beginning of the day for purposes of determining whether a corporation was an SBC.

Although the time of an amalgamation was generally considered to be the earliest time on the date of amalgamation in the absence of a particular time being specified in the certificate of amalgamation, here:

[F]or the purposes of determining whether the shares of the capital stock of Targetco qualified as a QSBCS at the time of their disposition by Mr. A, it would be reasonable to consider that the logical order of the transactions is, first, the disposition by Mr. A of the shares he held in the capital stock of Targetco, followed by the amalgamation between Targetco and Acquireco. Consequently, only the assets of Targetco, without taking into account those of Acquireco, should be taken into account in determining whether Targetco qualified as an SBC at the time of the disposition of the shares by Mr. A.

Thus, it was not relevant that Acquireco held the acquisition cash on January 1 prior to the acquisition and amalgamation.

Neal Armstrong. Summaries of 9 October 2025 APFF Roundtable, Q.3 under s. 256(9) and s. 87(2)(a).

A corporation realized a capital gain of $100,000 on May 1, 2024, thereby increasing its CDA from nil to $50,000, then on September 30, 2024 realized a capital loss of $30,000. Based on the proposed reduction in the capital gains inclusion fraction to 1/3, it computed its CDA as having been reduced to $40,000 and immediately paid a $40,000 capital dividend - which resulted in a $5,000 excess for Part III penalty tax purposes because the inclusion rate instead stayed at ½.

Regarding whether CRA would relieve the Part III tax, it noted that its power to waive interest or penalties under s. 220(3.1) does not extend to the waiver of tax imposed under s. 184(2), and that “the only possible relief … would be the election provided for in subsection 184(3) to treat the Excess as a taxable dividend to the recipient or recipients.” Not a word about the FAA s. 23(2) procedure (see, e.g., 2015-0578071E5 F), so perhaps the implication is that CRA does not think it is a big deal for shareholders to be taxable on a dividend under the s. 184(3) procedure.

Neal Armstrong. Summary of 9 October 2025 APFF Roundtable, Q.1 under s. 184(3).